There is a famous saying in the foreign exchange market: the market will do everything possible to drive the people involved in it crazy. So if investors are drunk in the market, please never forget our original intention to enter this market. Please carefully study the 80 foreign exchange trading strategies used by the speculators, and remember that you only need four tools: bar chart, moving average deviation, pivot point and trend line analysis. No more, simple. Don’t be misled and believe in others. The world is full of “skeptical Thomas”, they gesticulate but never made a penny, they sell shovels but they don’t use them.
When you first started, try to capture 20 points from each trading session, then stop, turn it off, and do more research. Ask for more when you are really good at it. Before you become a master in the foreign exchange industry, set a 20-point goal and stick to it. I emphasize the term industry, it is not a game, it is related to your hard-earned money.
Spend the main time on the 15-minute chart.
Before starting a certain trading session, look at the 1-hour chart to get the trend of the time period transition and how it might go when the new time period starts.
Look at the 5-minute chart only when you absolutely need to know what is happening behind the 15-minute chart, especially when the candlestick stretches or has just crossed the pivot point. In other words, whether a reversal has occurred on the 5-minute chart but has not been reflected on the 15-minute chart. come out?
Don’t stay on the 5-minute chart, because it has too many noises that will torture you to death.
The law of the moving average on the 15-minute chart: Even if the moving average is up on the 1-hour chart, if it is down on the 15-minute chart, this implies that a reversal is coming, but it has not yet occurred. At the same time you don’t want to miss what is happening as reflected on the 15-minute chart.
If the moving average goes up and down on the 15-minute chart, but the price wants to go up, sooner or later the price will go down, such as being bounced back by the pivot point, or by the node captured by the other three tools (bar chart, moving average divergence or trend line analysis) reverse. The same goes for the moving average line and the price going down.
Only use the divergence of the moving average instead of the moving average for trading signals. It is a delay indicator and is too slow for foreign exchange.
The divergence from the moving average on the 15-minute chart is more important than on the 1-hour chart. Divergence means that the moving average is opposite to the direction of price fluctuations.
Always use 20-30 pips stop loss to protect funds. Mental stop loss is also acceptable, but strict discipline is required. Do 10 times and you may be wrong 3 times. The loss of three times should be kept within 20-30 points, and your profit should be much larger than the small loss. Don’t be afraid of loss. Professional baseball players will miss 6 times in 10 times. The success rate of the lion chase is only 20%, and the failure rate of professional poker players is 50%. Your chances are better than them. There is no 100% certainty in life.
When you place an order close to the pivot point or an important pattern (such as a double top or trend line breakout), put your stop loss on the other side of the event that made you act, but don’t get too close, because the price tends to pull back after breaking through. If you use a stop loss of 20-30 pips, but 33 pips can safely pass the reverse draw, then use 33 pips. The rule is 20-30 points, but it must be reasonable.
The purpose of stop loss is to insure, not for profit. Of course, you can use the trailing stop loss method to protect your profit.
Only four tools are needed to trade foreign exchange: bar chart, moving average deviation, pivot point and trend line analysis. Be technical, avoid the fundamentals, the news has been integrated into the price, you do not need to read the news every second. Reading the bar graph includes finding double tops (bottoms) or even triple tops (bottoms).
Here comes the difficult part: I said that the forecast of the next trading session high and low can be M1M3 or M2M4, but the transaction is gray instead of black and white. The actual high and low can be any combination of M1, M2, M3 and M4. , Can be M1M4, M2M3 or any other combination of five pivot points. M1M3 and M2M4 are for reference only, not casted by cement. Price is the first indicator, it determines what the high and low will be. In addition, you should combine this forecast with three other tools. In other words, if the price goes down when it enters the current time period from the previous time period and continues to go down from M3, then M3 is likely to be high in the new time period, even if the system may indicate that M4 is high. So the pivot point should be used in combination with the other three tools. I have seen instances where the price goes down. The opening of the new session directly crosses M3, and a double top is formed. Here are three indications that the price must go down. I believe that the moving average must also be down at this time, which is another clue that the new period of high has appeared.
At the beginning, choose one of the four main pairs (EURUSD, USDJPY, GBPUSD, USDCHF), study its rhythm and become an expert. I recommend Euro. When you are doing well, trade the other three pairs. In the learning phase, you may be in a hurry, just make one, don’t jump around in four pairs.
Make transaction records, including good and bad transactions, analyze what is right and wrong, and swear not to repeat mistakes. Develop a good habit of being a professional trader. This is not a place where you can drag your guns around.
Important point: If the price opens at the top of the forecast range for the new period (R2 or higher), in other words, it is in the selling zone (areas above the central pivot point), and there are other indicators that indicate that the price is too high (such as a specific K Line, moving average divergence or trend line breakthrough), then the price may already be high in the new period. Similarly, if the price opens at the bottom of the forecast range for the new period (S2 or lower), or is in the buying zone (area below the central pivot point) and other indicators suggest that the price is too low, the price may be the new period Low.
If there is nothing to do, don’t do it, don’t do it impulsively or just want to do it, it will cause a lot of trouble. Only do it when the four tools have very clear signals.
To choose a trader, choose the one with the lowest spread in this row.
Sometimes after a weekend break, there will be dramatic fluctuations when the market opens on Sunday. Normally I use Friday’s high and low opening and closing (OHLC) data, but if there is a sharp fluctuation on the 15-minute chart on Sunday, I will use Sunday’s OHLC to better determine the support and resistance levels for the next period. Of course this only applies to traders who separate the two hours on Sunday from Monday.